CIMB bullish on outlook for structured deposit products

CIMB Group (1023), the market leader in structured deposits last year, is bullish on the outlook of such products this year given the improving global economy and wealth accumulation.

The country's second largest banking group, which launched over 30 structured deposit products last year, hopes to launch as many if not more this year, company officials said.

Last year, about half of the structured deposit products it launched were for the general public while the rest were tailor-made for its private clients.

"For 2010, we'll continue (with launches) in the regional, domestic and Islamic space. We'll do the same number of launches as last year, maybe more," said Datuk Lee Kok Kwan, deputy chief executive officer, group treasury and investments.
Chu Kok Wei, CIMB Investment Bank's head of structured and banking products, believes that there is pent-up demand for such products as investors had been nervous about investing last year.

"With the economy going reasonably well and wealth accummulation, there is quite a bit of pent-up demand. Customers who had been holding back in 2009, are now more willing to put their money to work," he said.

Lee and Chu were speaking to reporters at the group's first structured deposit launch for the year, Best of Asian Giants Access NID-i, a product of its Islamic unit, CIMB Islamic Bank.

It expects to raise RM300 million from the syariah-compliant investment product by the time the subscription period ends on February 3.

With tenures of 5 years or 7 years, it offers a chance for people to maximise the potential of investing in China, India and commodities.

It is unique in that it gives investors direct and indirect access to the world's two fastest growing economies, Chu said.

The "direct" basket invests in the H-Share Index Exchange Traded Fund, MSCI India Index and S&P GSCI Excess Return Index, while the "indirect" basket invests in multinational stocks listed outside of China and India but have significant revenues generated from them. These include stocks such as Nike, Hewlett Packard, Nokia, BHP Billiton , Yum! and Unilever.

"This product addresses clients' needs for a combination of safe, regular income and potential further upside riding on the expansion of China and India while addressing concerns of a possible market correction in the Chinese and Indian equities markets," Chu explai-ned.

The minimum investment amount is RM65,000.